The comments, made on Tuesday, were unusual because the 90-year-old monarch rarely comments publicly on political matters, and media accompanying her are asked not to eavesdrop on private conversations.
The incident came hours after Prime Minister David Cameron was caught on microphone calling Nigeria and Afghanistan "fantastically corrupt."
In the video - recorded by the palace's official cameraman at a palace garden party and distributed to broadcasters - an official introduced the queen to police Commander Lucy D'Orsi.
He explains that the officer was in charge of policing for the visit by Chinese President Xi Jinping in October. The queen responded with: "Oh! Bad luck."
When D'Orsi asked if the queen knew it had been a "testing time," the monarch interjected: "I did."
The officer recalled a moment when Chinese officials walked out of a meeting with Barbara Woodward, British ambassador to China, in which the Chinese told the Brits the trip was off.
"They walked out on both of us," D'Orsi said.
"They were very rude to the Ambassador," the queen said.
Both the Metropolitan police and the palace refused to comment on what they described as private conversations.
The palace stressed that Xi's visit had been "extremely successful."
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